Trick or treat? More on Ottawa’s tax changes

While much of Bay Street cries foul about tricks played on the income trust world, they’re overlooking a few tax policy treats that also came with the announcement, which are intended to soften the blow for seniors.

Although the “main event,” a distribution tax on income trusts and limited partnerships, is featured in most of the headlines today, the accompanying announcements about proposed personal income tax relief shouldn’t be overlooked. These proposals include an enhanced age credit for low- and middle-income seniors, as well as a change in tax policy that will allow income splitting for pensioners, beginning in 2007. These present some unique tax-planning opportunities.